US federal law requires retirees to annually withdraw a minimum amount from their retirement accounts after the age of 70 ½. [1] This is driven by a tax rationale: since pension contributions are generally tax-deferred, Required Minimum Distribution (RMD) rules require that taxes should be paid on pension benefits during old age. Yet a criticism has been levied at RMD rules, namely that they may prejudice good retirement policy. To the extent that some households are required to draw down their pension wealth too soon, this increases the risk that they will outlive their resources.…Read More
RetireSecure Blog
The Pension Research Council’s curated blog features insights from the industry’s leading professionals.
Views of our Guest Bloggers are theirs alone, and not of the Pension Research Council, the Wharton School, or the University of Pennsylvania.
What’s Wrong With Our Retirement System & What We Can Do About It
As the Baby Boom moves into retirement, confidence in our retirement system is waning, for good reason. Plan sponsors, including public and private employers, are rapidly freezing their defined benefit plans—those that promise a guaranteed level of income in retirement—by closing the plans to new hires or stopping current employees from earning additional benefits.…Read More
Seven Retirement Gaps And What To Do About Them
What do we expect to happen as we age, and how do our ideas about retirement planning change? New research on post-retirement risks by the Society of Actuaries identifies where the knowledge gaps are and how we can do better.…Read More
Capping Pension Costs? Cautionary Lessons from the UK
Economists typically criticize price regulation because, for most products, competition is seen as sufficient to drive pricing to reasonable economic levels. Moreover, consumers are usually better off as a result of the competitive process. Exceptions would include cases where significant economies of scale exist, as in the case of utilities, and also where imperfect information impedes the orderly operation of markets.…Read More
Argentina’s Pension Policy In The Last 20 Years: Chronicle Of A Death Foretold
Argentina is one of several countries that implemented a major structural reform of the pension system during the 1990s and then, more recently, decided to reverse itself. This note presents a summarized discussion of the motivations and main characteristics of the early reform, the performance of the system since then, and the rationale for and impacts of the recent changes.…Read More
Financial Savvy Key To A Secure Retirement
Over the last 40 years, we as individuals have been given increasing responsibility for ensuring our own financial well-being in retirement. But it’s gotten quite complex, with an alphabet soup of retirement saving vehicles – from 401(k) to 403(b) plans to IRA and Roth IRAs – and our responsibilities loom large. Not only must we figure out how much to save and how to invest our retirement assets, but we also must take advantage of a variety of tax-favored assets, employer matches, payout options, and much more.…Read More
Key Retirement Concerns And 7 Planning Tips For Women
Retirement planning is extremely important for women, and ideally it should consider the big picture including financial resources, the family’s situation, risks, and employment. Nevertheless, many women are more focused on meeting their families’ current needs than on their longer-term futures. This article looks at how family issues can shape women’s retirement plans and examines issues and planning steps that might otherwise be overlooked.…Read More
How To Get More Guaranteed Retirement Income In The 401(k) Age
In the old days, many Americans had a defined benefit (DB) pension that paid them a steady guaranteed income in retirement. But the pension landscape has shifted dramatically: now more than half of all US retirement assets are in self-directed defined contribution (DC) plans, such as 401(k)s and individual retirement accounts (IRAs) – and the figures are rising. These DC plans and IRAs do offer millions the chance to build up and control their own nest eggs, but what they don’t offer is a guaranteed income in retirement. Instead, retirees must manage their nest eggs themselves and hope that their decisions – how much to save, where to invest, and how much to take out each year – and the ups and downs of the market, will permit their money to last as long as they do.…Read More